Weekly Bitumen Report: Crude Oil Price Led to Market Fragility

On 25 April, Joe Biden announced his candidacy for the presidential election of 2024 in the USA. It is not still clear who would be known as his serious competitor in the Republican Party. Based on the latest survey of Reuter, Biden’s current popularity is about 39%. It seems that changes in the financial markets can be expected by the start of election campaigns.

With the announcement of economic improvements in China, it is heard that the export of Russia’s oil to China has increased so that Russia exported around 2.26 million barrels of oil to China daily in March.

In the meantime, the American Petroleum Institute (API) announced that USA’s oil reserves decreased by around 6.1 million barrels in the week ending April 21 while the analysts had estimated the drop to be around 1.5 million barrels. During the last week, the US gasoline reserves fell by about 1.9 million barrels, while other fuels increased by around 1.7 million barrels. It was expected to observe a surge in oil prices by this piece of news, but on Thursday, Brent crude oil reached the channel of 70 USD, and it was recorded at 77.98 USD.

For the second time in the last six months, despite the OPEC oil cut, the oil prices have initially followed an uptrend and then dropped due to concerns about the deep recession in the world.

Although some analysts believed that oil prices will exceed 100 USD by the end of 2023, some others worryingly believed that the cut of supply by OPEC happened as a result of the global recession and the prevention of price drops. However, the technical trend of crude oil showed downward signs during the last week.

On Wednesday, 26 April, Singapore’s HSFO CST180 fell by 10 USD and reached 454 USD, and its bitumen price decreased by 5 USD too and returned to the level of 465 USD.

In South Korea, bitumen prices decreased by 5 USD as well, and it was 430 USD. Bahrain’s bitumen price is still stable in the range of USD 370. It seems that bitumen prices in India will be stable on 1 May, although the demand is still highly significant.

However, Iran’s bitumen prices are still under the severe pressure of competition for the purchase of vacuum bottom and fluctuations in the exchange rate, and the export trend does not seem to be upward.
During the last week, around 77% of competition for vacuum bottom purchases was observed among the Iranian refineries, which was less than in previous weeks. However, it is still a high rate of competition.

As it was continuously mentioned in the latest reports of Infinity Galaxy, the fragile situation of the market has not been stable yet, and more fluctuations can be expected too. Hence, the buyers are advised to carefully observe the market changes before making any purchases.

This article was prepared by Razieh Gilani, the export manager of Infinity Galaxy (https://infinitygalaxy.org/).